Introduction
You’re probably wrong about the anime industry. People talk about it a lot on social media, and it’s easy to learn about it that way, but if you talk to the wrong people, then it’s easy to pick up the wrong ideas and build misconceptions on that. In this essay, I’ll talk about the realities of the industry and some of the misconceptions I’ve been seeing on social media lately.
The Budget Myth
The amount of money that a given anime has does not necessarily correlate to the quality of an anime. This is the most pervasive myth about the anime industry, and thus, it’s the first that I feel I should focus on. This isn’t to say that the amount of money a production has is irrelevant, because people do need to be paid, but it’s not as make it or break it as people think, and certainly the meme that good animation equals high budget does not stand to reason.
The biggest reason for this is that animators are horribly underpaid. Wages per drawing are criminally low, as low as 200 yen ($1.41), so no matter how much money the production has, more money will not equal better animation. What makes animation good is the specific animator, and while better animators can use their skill to argue for higher wages, they will still be underpaid. Thus, when an anime has good animation, it will come down to the specific nature of production.
However, the quality of animation doesn’t just fall to animators— specifically, I am talking about key animators, second key animators, and in-between animators here. The director, storyboard artist, and animation directors will all be dictating the pace and rhythm of an anime and how many cuts are used. Getting into this requires getting into more specifics of the industry and production.
A production will have a set amount of time to create their anime. Within that time, it’s split up and allocated to different episodes. Thus, an episode with lots of high quality animation and elaborate layouts will take more time, while a simple episode without much of that will be easier. There are many tricks that production teams can use, such as effective layouts or animation shortcuts, to make the episodes with less animation still stand out, and thus serve as rest episodes, meaning they have more time to produce the better episodes.
Naturally, since the production team is being paid the same no matter how much work they put in, the budget being given is largely irrelevant. An underfunded production might be short on staff, and there are other ways that production lacking money can cause issues, such as limited materials, but by and large, it’s the amount of time allocated that matters more.
However, when that allocated amount of time is limited, productions will run into issues. A healthy production will spend more or less time on episodes as their needs dictate, but if they’re working under crunch, then that means that every episode must be produced in a more limited manner. Good animation is still possible, but it’s more difficult, and the more time is spent on one episode, the less time is available on others, which can cause a snowball effect, which is how productions such as Flip Flappers or Wonder Egg Priority struggle to finish airing.
Essentially, infinite money is not infinite time. You can keep throwing money at a project, but if everyone is already overworked, that will not make them do more work. The best you can hope for is to hire more animators, more animation directors, but in that case, it will cause strain on the production as more management and oversight is needed, leading to an overall weaker product. One only needs to see how many animation directors anime like Gundam: Witch From Mercury have per episode to see how horrifying the situation is getting. If money is treated as the solution to crunch, then the crunch will only get worse, and more endemic.
If you see a high-quality cut of animation out of context, or a low-quality cut, your reaction should not be to assess it on what you think the animator was paid for that cut, but rather, appreciate the skill involved in creating it.
The Economics of Anime
A concept that has plagued anime fandom for years is that of the Manabi line. If you’re not aware, the anime Manabi Straight sold 2,899 units in the home release, and reportedly broke even. This became a meme on 2chan, and eventually spread to the anglosphere fandom, where people began taking it seriously. The idea is, if an anime sells 2,900 units in the home release, it has become profitable. If it sells 2,898, then money has been lost. This isn’t true.
Disk sales aren’t totally irrelevant. If you look at something and see that it sold, say, 600 units, it probably isn’t doing well. On the other hand, if it sold 10,000 units, that’s a massive success. However, disk sales are an overly simplistic way of looking at the financial aspects of anime, especially in the modern era of anime when streaming and online sales have become more prevalent than ever, and overseas viewership is more important than ever.
The first thing to understand is that anime is inherently a niche. A majority of anime air late at night on dedicated TV blocks, even in the era of streaming, and these shows are watched primarily by an otaku audience. Many other anime have time slots outside of that, especially ones with broader appeal such as Weekly Shounen Jump adaptations or other kids’ shows. Since these anime are targeted towards an adult audience, they’re able to charge prices aimed towards working adults. If you’ve ever tried to buy Japanese blu-rays, you’ll know that they are expensive. 6,000 yen is normal for a single volume, and a volume might only hold two episodes. Essentially, these are luxury products. If you really care about an anime, you’ll buy the blu-rays. However, if you aren’t one of those people who has decided that they care that much about a given series, you will instead rent the blu-rays, or more likely, DVDs, from a rental store and watch it that way.
However, if we’re only looking at disk sales, then we’re getting an incredibly incorrect view of how anime make their money, especially in the modern era. Disk sales are more irrelevant than ever, and they exist more and more only for the superfans who don’t want to watch anime digitally, or who merely see the blu-rays as a collector’s item. However, for fans, there are so many other collectables for a given anime that will be available. Everything from stickers, to figures, to tin badges, to posters, to radio dramas, to soundtrack sales, and all the way down to the original source material. These are where anime are intended to make their real money. In essence, the anime is an ad for the merchandise, and if you simply watch a show, enjoy it, then move on, you are not the kind of fan who will meaningfully contribute to the industry. It’s a similar whale/dolphin structure that gacha games use.
Recently, news broke that the anime Yuri on Ice had not been profitable for the studio behind its creation, MAPPA. However, I feel that this is deceptive. As an article on sportskeeda pointed out, the anime had eight different producers on its committee, and MAPPA was listed last. That means that all of the money that Yuri on Ice made was going to other sources. After all, all those different merchandising sources that I mentioned are not just created by the studio. When a figure is made, the profits will be split between the figure maker and the committee. When the anime makes ad revenue on its TV airing, that will be split between the station and the studio. The companies which poured money into the creation of the show will want money back. Thus, while Yuri on Ice was likely highly profitable, the studio behind the creation was not the one enjoying this profit. The producer structure will vary from anime to anime and studio to studio— for example, KyoAni typically produce their own anime, and be listed as one of the main producers, if not the first producer, meaning that the studio will take in more of the profit compared to MAPPA. However, what to take from this is that these deals won’t be uncommon, and that creators are not the ones most profiting from their own works.
If you’ll allow me to indulge a little, a comparison can be made between anime studios and the defunct wrestling company World Class Wrestling, otherwise known as WCW. During the 90s, particularly the mid-90s, WCW was highly successful, outclassing its opponent, the WWF. However, in the late 90s and early 00s, the business began to falter, and following the merger between its parent company, Time Warner, and AOL, the company was cut for cost-saving reasons, and later bought by WWF owner and absolutely wretched human Vince McMahon for only a few million dollars. What would be repeated for decades after is that during all its success, WCW had never been profitable, and that was used as justification for its failure. However, the issues run deeper. WCW was run as a loss leader, but at the same time, any of the profit it made was redirected to elsewhere in the company, so while the company was spending their own money, they weren’t allowed to make money back. Within such a deal, the company was never going to be profitable. If MAPPA is the last of eight producers, they’ll make very little money, even if the series is a runaway smash success.
There is more to say about production committees and the sponsorship behind anime, but this is a subject I’m less familiar with, so instead I’ll direct you to check out an article on the subject by fullfrontalmoe, linked in the citations down below.
The Realities of the Anime Industry
Collapse is imminent. There’s no two ways around it. The industry is set to collapse, and even radical change would struggle to prevent it at this point.
The core of the issue is overwork. More anime are being made than ever before each season, and as such, the anime needs more animators than ever to meet that demand. There are millions and millions of passionate anime fans in the world, and many are interested in getting involved with the industry themselves.
The problem is that you cannot just know how to draw and immediately start animating, let alone working in the industry. There’s training needed, and people need to know how what they’re working for. However, as demand increases, training is being shortcutted more and more. This isn’t helped by the fact that experienced animators are beginning to burn out and retire, taking their knowledge and experience with them. New animators are also burning out at faster rates than ever, so animators have a high turnover rate. Measures are being taken to fix the lack of training, but that takes time. An animator who begins training today won’t be able to work for some time more, and once they start, they might find the amount of work too crushing, or the pay too low, and choose another career.
But it’s not just domestic animators that are having issues, and it’s not just domestic animators that are being overworked. For decades, anime has relied on outsourcing in-between animation work to Korea and Southeast Asian countries, and this has only grown in the digital era. While most key animators are still Japanese, the work of turning the key animation into proper cuts, which is the most medial and demanding work, falls on other countries, especially those with worse financial situations than Japan. The work is incredibly exploitative, and nearly all studios participate in it, whether to save money or out of sheer necessity.
But outsourcing isn’t limited to in-between animation, and it isn’t limited to countries near Japan. As schedule slippage has gone from becoming more common to a fact of life, studios have turned more and more to international web animators. Revue Starlight, in 2018, was remarkable yet concerning for the way that it had to turn to web animators, and that made it stand out. Now, in 2023, such a thing has become commonplace. Not every anime uses web animators, but with production disasters becoming more and more common, it’s less and less of a surprise to watch the credits of a seasonal anime and see a name you recognize from twitter. It’s even a joke in sakuga twitter that studios will hire anyone with “animator” in their bio, out of sheer desperation.
But it’s not just animators. One of the most noticeable signs of the issues of the industry are the overuse of animation directors. As mentioned before, if a studio wants to use budget to solve their scheduling issues, that will mean more people are involved in the work. Typically, key animators work on their cuts, then send it off to the animation director, who checks their works, notes any corrections, and sends it back. If there are more animators involved, that means more animation directors. If there are more web animators involved, who are typically amateurs who have little or no professional experience, then there may be more corrections needed. This scales unfavorably for studios and means that as more money is thrown at a project, there’s more strain on a the staff. This is how we get projects like Wonder Egg Priority with seven animation directors working on a single episode, or Gundam Witch From Mercury with 17 animation directors working on a single episode.
I don’t know when the anime industry will collapse completely, but it’s imminent. It might be five years from now, it might be a decade, or it might be two years, but when it happens, it will be sudden, and studios will be left struggling to survive, if they can survive at all. It’s depressing to consider, but decades of bad choices mounting on each other have led to an industry which is fueled by the blood of its workers. We can only hope that when things start falling apart, what managed to be rebuilt from the wreckage is something better.
Streaming is a Blight
It’s hard to deny the effect that streaming has had on anime. Crunchyroll can be said to be personally responsible for the explosion in popularity that followed shows like My Hero Academia, Attack on Ttian, and Haikyuu. This made weekly releases easier than ever to follow which engrained the seasonal model into the culture. However, while there are issues with seasonal anime and Crunchyroll, I won’t be talking about that here. Rather, this is about the binge model of streaming seen on websites such as Netflix or Disney+.
Weekly releases maintain interest in an anime, while the binge release used by streaming giants creates a sudden burst of interest which quickly dies off once everyone has seen it. Weekly releases are also easier to follow, as it’s a smaller time commitment than watching 12 or 24 episodes all at once. Shows released via the binge model feel more like content to be consumed, digested, and forgotten about, merely a tick in that quarter’s profit margins, while airing anime can be more of an event.
But while that’s frustrating, the model through which Netflix, Disney, and others release their anime is not the only issue, and not even the worst issue. Rather, the issue is the strain they create for the industry. There are already too many seasonal anime being produced at a time, so the anime made by these studios exist outside of that and pile onto the problem. There is already too much anime being made.
But the release model is an issue, too. If a studio working on an airing anime misses a deadline, they can delay the episode or air a recap in its place. These measures are not good, but if worst comes to worst, there are solutions. Streaming deadlines will be more absolute, and while they theoretically mean that a studio can take their time to produce the best possible product, they will still have deadlines to meet, meaning they will be under the same crunch with new issues.
Additionally, Netflix has made the absolutely insane choice to have studios produce translations, both dub and sub, of their animations for the international release, rather than Netflix handling it themselves. This is a bigger financial burden on the studio, and depending on what place they have in production, it may mean that the studio is set to lose more money if the series doesn’t do well.
Oh, and with companies like Crunchyroll and Netflix making anime a bigger and bigger part of their business model, they’ve had more and more incentive to produce their own anime. This means studios are getting less of a cut, this means more anime is being produced, and this means that existing problems are further exacerbated. Much of the demand on the industry is foreign, rather than domestic, due to these companies and others putting more money and demanding more anime be made.
Streaming has had positive impacts on the industry! Ease of access has increased and that’s important. But people frequently claim that the Netflix model is better for the industry, and that Netflix should produce more anime to help the industry, and such a claim is incredibly naive because Netflix isn’t helping. They aren’t even a positive influence in the industry. They’re a blight.
Unions Can’t Save Anime
This is what prompted me to write this essay. With the surge in union popularity following the WAG and SAG-AFTRA strikes, people have begun to clamor about how the anime industry should unionize. And, well, it’s not that easy. Unions can only help so much, and with the specific issues that the industry has, I don’t know how much they would be able to help at all.
Unions are not prevalent in Japan. This is in part due to more robust labor laws, as without those, unions are more necessary, but also the period of economic boon that Japan experienced during the 80s which allowed companies to corrode union support. From firsthand accounts I’ve heard, companies are strict, and there are few protections from trying to unionize. So in the first place, most studios won’t be inclined to unionize.
However, even in an ideal world where the above was not true, anime studio unions would be unlikely. For one, the industry is heavily based on freelancers. This is why discussing studios as entities is difficult, because many studios have little in the way of established staff. Coincidentally, the few studios who do have a consistent range of staff, such as Kyoto Animation or P.A. Works are also notable for treating their staff better than most. These freelancers wouldn’t fall under the purview of a union, so unless there was an industry-wide union that every company had to abide by, it wouldn’t work. And as for making an industry-wide union… That just wouldn’t happen. Let’s be realistic. Such a thing would be impossible to implement. Many animators work on passion, which is why they accept such low wages. They want to be a part of the industry, and that itself is an advantage of the job. If they went on strike, then there would be more people behind them eager to replace their jobs for them. There are scabs everywhere, and no one wants to risk their job if they’re so easily replaced.
That’s not all. We’re in the era of outsourcing and web animators. Outsourcing is even harder to unionize, and if one company, or even the industry in an entire country, unionized, companies would simply outsource somewhere else. This is why it’s so difficult for VFX to unionize, for example. Web animators are even more difficult, as they have no one place they’re based in, and no connection to each other, and thus would be impossible to unionize without massive overhauls to the industry.
The worst part of this is that industry crunch would still exist in a world where the anime industry is unionized, because there is still too much work for the industry. Unions would be nice to have, yes, but the issues that are truly harming the industry must be dealt with first before that can even be considered a solution. Unions could solve things like being underpaid, but when the industry is handing studios a new anime every season, sometimes multiple, there’s nothing else to be done. Could unions help push back against that work? Maybe somewhat, but it’s naive to think that it would be the one-note solution. Unions are not a magic panacea to every solution, and sometimes there are other sectors which should be improved for more meaningful impact.
Seasonal Anime Are Not The Problem
Seasonal anime are a boogyeman among people who talk about the issues of the industry. And it’s true that having to churn out anime after anime, season after season, isn’t making anything better, but I don’t think the issue is with the structure.
For one, seasonal anime are older than a lot of people realize, and that’s because seasonal anime are just part of seasonal TV. This isn’t unique to Japan either. The year is broken up into quarters and during those, TV stations will try to air specific shows. Thus, at the start or end of seasons, new shows will begin. Live action or animation, United States or Japan, this structure has been a thing for many decades now and I don’t think it’s going away anytime soon. And as I’ve discussed, the alternatives to seasonal anime aren’t great either.
The reason why it seems like seasonal anime are a problem is because most people only became familiar with it in the streaming era. Before the streaming era, anime’s availability outside of Japan was very different, reliant on fan translators or downloads, or physical DVD and VHS releases. Those would happen irrespective of when the show actually aired. But with streaming and with simulcasting, audiences outside of Japan have access to these shows in a more natural format that they were released in.
The schedule isn’t the issue. The problem is the excessive overwork that the industry is inflicting on its workers. “Seasonal anime” is not synonymous with 80 new anime each season. If it could be scaled back, then the seasonal anime structure would be less of a problem. Unfortunately, that’s easier said than done.
I talked about this early on, but the way that production works is that within their time schedule, certain episodes will be given more or less time to be worked on. This kind of scheduling works less well for streaming, as it was devised for weekly airing anime. Indeed, much of the industry’s habits were made for weekly anime. If the scheduling is good, there is no issue with weekly releases. The problem is that the schedule is not good, and hasn’t been in a long time.
Along with decrying the seasonal structure, many people on social media also yearn for the return of multi-cour productions. Indeed, single cour anime are far more common these days, and have been ever since the streaming era began. “The good old days,” otherwise known as when these people were younger, otherwise known as the 00s and early 10s, had far more two cour anime, or even three or four cour anime.
The problem is that it’s not feasible anymore.
Look at Witch From Mercury again. That was a production disaster, and that included a season-long break between its two cours. More cours means more strain on the production due to continuous work. It’s also more of a commitment from the studio and staff, and requires more planning and pre-production. In an era when anime are struggling to finish a single cour, two or three are inconceivable.
Multiple cours aren’t better for the staff. They need to do the same amount of work either way, and as Witch From Mercury proved, there will still be plenty of issues with two cour anime. What the call for two cour anime really amounts to is fans looking at anime suffering in quality from their lack of time to express their ideas, and the production falling apart, and wanting to imagine how it could be better. What they think is that the show would be better if it was given more time. And you know what? The quality of the story in most examples people bring up likely would be better if these shows were allowed more time. But this is an audience-led argument that would benefit the audience. Its benefit to the people making it is negligible, and could even be a net negative if things keep declining.
The needs of the consumer and the needs of the creator do not always align. What you think would lead to making better anime is not necessarily what would lead to animators being paid better or crunched less.
Conclusion
I hope that, if you’ve read this far, you’ve learned something about the industry. There’s a lot of misinformation about the industry, and even more misconceptions, that lead to people talking about the industry in ways which are clueless at best and outright ignorant at worst.But at the same time, while I was pessimistic here, do note that it’s not all bad, and that there are projects trying to help the industry. In particular, I recommend the Animator Dormitory Project, which raises money to help out struggling animators. Giving them money will directly help struggling artists, so check them out.
Citations
Regradring my citations, there’s a lot I talk about here that isn’t cited, because it’s things I’ve picked up from years of reading sakugablog and following sakuga people on twitter. You can treat the citations for most of this as “it is known.” However, for a few specific concepts, I’m pulling from specific articles, and if you want to read more about any of those, you can check those out here:
- Budget talk: Pokemon’s High Budget Animation Explained!
- Manabi line: Weeb-onomics: What Is “Success” For Anime?
- Yuri on Ice didn’t make MAPPA money: MAPPA CEO faces backlash after controversial money-driven remarks on Yuri on Ice
- Data on anime production comiteees: https://docs.google.com/spreadsheets/d/1nhT1ebLxejyagiiLET8ajDu9CnHaTrhsRsjNdiRfur0/edit#gid=1841479695
- Anime production and sponsorships: Production Committees – Understanding the Anime Business Model
- Efforts in training new animators: The Long Quest To Fix Anime’s Collapsing Mentorship: The Young Animator Training Project, And Its Legacy 10 Years After LWA & Death Billiards
- Animation Runner Kuromi (dir. Akitaro Daichi, 2001)
- Discussion on Netflix and streaming: Screw Amazon (But Actually Screw Netflix More)
- Netflix makes studios pay for their own translations (untranslated): ネトフリ版“攻殻”の可能性からアニメーターの給料問題まで…プロダクション・アイジー石川社長ロングインタビュー
Ostensibly Extant 